Petty cash fund : Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system. To prepare : A journal entry to create the petty cash fund.

Question

Want to see the full answer?

Answer 1

Question

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Express Delivery Company (EDC) is considering outsourcing its Payroll Department to a payroll processing company for an annual fee of $220,800. An internally prepared report summarizes the Payroll Department’s annual operating costs as follows: Supplies $ 30,800 Payroll clerks’ salaries 120,800 Payroll supervisor’s salary 58,800 Payroll employee training expenses 10,800 Depreciation of equipment 20,800 Allocated share of common building operating costs 15,800 Allocated share of common administrative overhead 28,800 Total annual operating cost $ 286,600 EDC currently rents overflow office space for $36,800 per year. If the company closes its Payroll Department, the employees occupying the rented office space could be brought in-house and the lease agreement on the rented space could be terminated with no penalty. If the Payroll Department is outsourced the payroll clerks will not be retained; however, the supervisor would be transferred to the company’s Human…

Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Thalassines Kataskeves, S.A. Income Statement—Bilge Pump For the Quarter Ended March 31 Sales $ 410,000 Variable expenses: Variable manufacturing expenses $ 123,000 Sales commissions 50,000 Shipping 21,000 Total variable expenses 194,000 Contribution margin 216,000 Fixed expenses: Advertising (for the bilge pump product line) 27,000 Depreciation of equipment (no resale value) 120,000 General factory overhead 38,000* Salary of product-line manager 113,000 Insurance on inventories 5,000 Purchasing department 49,000† Total fixed expenses 352,000 Net operating loss $ (136,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of…

Do companies maintain two sets of depreciation schedules, one for financial reporting and the other one for tax purposes?

Answer 2

Question

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Answer 6

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Answer 7

Chapter 7, Problem 7.16E

Requirement 1:

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.

To prepare: A journal entry to create the petty cash fund.

Answer 8

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Answer 9

Requirement 2:

To determine

To prepare: Journal entry to record petty cash fund replenishment.

Answer 10

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Answer 11

Requirement 3:

To determine

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 15

Ch. 7 - Prob. 1QC Ch. 7 - Prob. 2QC Ch. 7 - Prob. 3QC Ch. 7 - Prob. 4QC Ch. 7 - Prob. 5QC Ch. 7 - Prob. 6QC Ch. 7 - Prob. 7QC Ch. 7 - Prob. 8QC Ch. 7 - Prob. 9QC Ch. 7 - Prob. 10QC

Solution Summary: The author explains how a petty cash fund is established to pay insignificant amounts like postage, office supplies, and lunches.

Concept explainers

To prepare: Journal entry to record petty cash fund replenishment.

To prepare: Journal entry to record the decrease of petty cash fund to $140 from $270.

Want to see the full answer?

Chapter 7 Solutions